CC PACKET 09082015 - Laserfiche WebLink

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Each year the General Fund revenue and expenditure budget line items are examined for changes in expected collections/charges, labor adjustments, changes in contract rates, insurance rates, utility costs, usage of various materials or needs, etc. The findings of this examination produce the drivers associated with the proposed 1.93% increase in the General Fund Levy - see below:  Personnel costs - 73% of expenditures, overall costs up 2.92%  Union contract increases 2.5%  Health Insurance premiums up 11.5%  Union Longevity, Steps, shared HR, Workman’s compensation rates  Contracted services - 9% of expenditures, overall costs up 3.05%  Property and liability insurance costs - 4% of expenditures, rates up 5.22%  Pass through costs - 5% of expenditures, costs up 4.39%  Remaining budget line items combined - 9% of expenditures, net costs up 0.34%  Impact of a reduction in liquor profits available for transfer was phased in through the use of one time fees and fund balance, mitigating the general fund impact by 2.78% The HRA budget and Levy contains cost drivers similar to the general fund. Conversely this fund does not have the same resources and transfers available in order to offset cost drivers. Therefore the proposed Levy increase for the HRA is 5.56% or $7,388. The 2016 Debt Related Levies are proposed to increase by a combined 1.87% increase over the 2015 combined levies. The $43,537 increase represents a 0.75% increase to the Overall Levy. A debt levy reduction program (Peak to Plateau) began in 2014 to stabilize the annual increase in levies created the annual street reconstruction plan. Without the use of resources committed to this program the impact of 2015 street bonds issued along with existing debt service requirements would have required a 5.05% increase in the Overall Levy. The 2016 Capital Funds Levies are proposed to increase by a combined $103,990. This increase is part of the phase–in plan to recognize that liquor transfers are estimated to be $146,395 less than 2015. The phase-in approach uses of one time fees and fund balance. The impact of the Capital levies increase is eased by phase–in approach used within the General Fund Levy. Staff will continue to seek Grants and Donations from Federal, State and private sources to help offset the cost of operations and capital equipment. At the September 8th City Council meeting, Staff will present the preliminary 2016 General Operating Budget and Property Tax Levy to the City Council. At this meeting a resolution will need to be passed certifying the preliminary levy to Hennepin and Ramsey Counties. The final presentation of the 2016 General Operating Budget and Property Tax Levy is scheduled for the December 8th, 2015, Council Meeting. At the meeting, Staff will present a recap of the 2016 General Operating Budget and the impact of the 2016 Property Tax Levy. 16